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New business, getting startup funds

Established Member

New business, getting startup funds

Having recently started a new business, less than a month old, I’m challenged with finding capital/funds with no business history. My business has no credit at this point either, positive or negative. What are some good options for getting any business funding? I would prefer big banks, but apparantely they require years of business or revenue for such business.

 

My business need is vehicle equipment in the range of $50,000+.

 

I’ve read mentions here of fundbox and others. Fundbox could work, but their terms seem very short for a high rate loan.

My personal credit is in the 800+ fico range, average age of accounts in the 8+ years range, no negatives, have a mortgage and several credit cards with good and long (10+ years) history.

 

Are there any big banks that will make exceptions? Are they looking for a personal guarantee to qualify?

 

Thanks!

Message 1 of 9
8 REPLIES 8
NYC_Fella
Regular Contributor

Re: New business, getting startup funds

No bank that I know of will loan you $50K for a new business without a personal guarantee, even with the vehicles as collateral.

 

My former business partner has a logistics business and she has used Ally for truck financing. But she needed to give a personal guarantee despite having a thriving and profitable business with $800K in the bank.

Message 2 of 9
waqaszm1
Regular Contributor

Re: New business, getting startup funds

Business credit if lacking can be countered with a personal guarantee. Your problem is a lack of revenue.

 

You will almost definitely have to personally guarantee a business loan.

Message 3 of 9
silver_idle
Established Contributor

Re: New business, getting startup funds


@NYC_Fella wrote:

No bank that I know of will loan you $50K for a new business without a personal guarantee, even with the vehicles as collateral.

 

My former business partner has a logistics business and she has used Ally for truck financing. But she needed to give a personal guarantee despite having a thriving and profitable business with $800K in the bank.


Some banks usually have a specific requirement before giving a loan without a PG. Usually need to see income in the $1MM range, be in business for several years, and usually need to show the business can take care of itself. Also, while not required, its usually best for the business to be formed as a corporation over an LLC, but LLC can also still get a No-PG loans but they like to see the tax structure as a corporation in most cases. Such requirements still vary from bank to bank. 

Message 4 of 9
credit8502020
Frequent Contributor

Re: New business, getting startup funds


@borsin wrote:

Having recently started a new business, less than a month old, I’m challenged with finding capital/funds with no business history. My business has no credit at this point either, positive or negative. What are some good options for getting any business funding? I would prefer big banks, but apparantely they require years of business or revenue for such business.

 

My business need is vehicle equipment in the range of $50,000+.

 

I’ve read mentions here of fundbox and others. Fundbox could work, but their terms seem very short for a high rate loan.

My personal credit is in the 800+ fico range, average age of accounts in the 8+ years range, no negatives, have a mortgage and several credit cards with good and long (10+ years) history.

 

Are there any big banks that will make exceptions? Are they looking for a personal guarantee to qualify?

 

Thanks!


@borsin Congratulations on your new business! I know you mentioned vehicle equipment. Is that all you need the funding for? Ex. Are you planning to buy a fleet of vehicles or one vehicle now and another in 6 months, etc.? What type of equipment do you need? I'm asking because having a strategic funding plan makes a big difference in how much funding you will be able to get in one round. I can help you identify a number of options, but there are a number of variables to consider in helping you structure everything in the most optimal way possible. 

Message 5 of 9
Society1
New Contributor

Re: New business, getting startup funds

Apply for the capital on tap card brother should give you at least 10K

Message 6 of 9
4sallypat
Established Contributor

Re: New business, getting startup funds


@Society1 wrote:

Apply for the capital on tap card brother should give you at least 10K


In addition to Capital on Tap, try Divvy and Torpago - these are the new fintech banks that will lend to new businesses.

Message 7 of 9
Society1
New Contributor

Re: New business, getting startup funds

Torpago? Never heard of them I will definitely do my research on them! Thanks 

Message 8 of 9
4sallypat
Established Contributor

Re: New business, getting startup funds


@Society1 wrote:

Torpago? Never heard of them I will definitely do my research on them! Thanks 


https://www.torpago.com/ 

Yes, this corporate card is a new fintech business that makes it easy for new businesses and startups to get business credit.

I am applying as soon as my D&B, Biz EXP/EQ starts showing.

They don't use personal credit so you do need an EIN w/ business bank account.

 

Message 9 of 9
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